High Court restrains claimants from using defendant’s privileged material obtained from third parties in unknown circumstances

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A recent High Court decision demonstrates that, whilst confidentiality is a prerequisite to a claim for privilege, information will not cease to be confidential unless it is in fact known to a “substantial number of people”: Winstone v MGN Ltd [2019] EWHC 265 (Ch).

In the present case, the court found that the quality of confidentiality had not been lost where the contents of the privileged material had come into the hands of a small group of investigative journalists and at least one investor, and may have (though the evidence did not establish that it probably did) come into the hands of others.

The decision is consistent with previous judgments which suggest that the courts may take quite a robust view as to when privileged material has (or has not) entered the public domain, so as to lose the requisite quality of confidentiality, particularly where the privileged material has been obtained in breach of confidence (see this post) or through inadvertence (see this post) – that is, outside the disclosure process in legal proceedings, where different principles apply (as considered here).

Background

The issue arose in the context of the phone hacking litigation, in which large numbers of claimants have brought claims against MGN for breach of privacy, alleging that their private information had been accessed by means of voicemail interception.

MGN applied for an injunction to restrain the claimants from referring to documents or communications which MGN contended were privileged, and which the claimants had obtained from third parties who themselves had obtained them in unknown circumstances. These were:

The Partington Note: a marginal note which was made by MGN’s in-house lawyer, Mr Partington, on a copy of a witness statement served on MGN in employment tribunal proceedings.

The Grigson Comments: comments made by the chairman of MGN’s parent company, Mr Grigson, at a reception following the company’s AGM, in which he responded to enquiries by a former MGN reporter, Mr Johnson, about what Mr Partington had said regarding knowledge of phone hacking.

The claimants argued that the claim to privilege must fail because the relevant material could not sensibly be regarded as either initially or still confidential, or alternatively that as a matter of discretion an injunction should be withheld.

Decision

The High Court (Mr Justice Norris) upheld the claim to privilege and granted the injunction in respect of the Partington Note, but rejected the claim to privilege over the Grigson Comments.

Partington Note

It was common ground that when the Partington Note was made its contents were privileged, either as recording advice from MGN’s external lawyers, or as recording an assessment by Mr Partington as to what should be sensibly done. It was also common ground that, once privilege attaches, the privilege is absolute and cannot be disregarded on the basis of some higher public interest.

The issue was whether the Partington Note had lost the character of confidence which is essential to an assertion of privilege. The judge held that it had not. The content of the Partington Note had come into the hands of a small group of investigative journalists and at least one investor, and may have (though the evidence did not establish that it probably did) come into the hands of others. That did not mean that the quality of confidentiality had been lost. Applying the comments of Sir Nicholas Browne-Wilkinson VC in Stephens v Avery [1988] 1 Ch 449, information only ceases to be capable of protection as confidential when it is in fact known to a substantial number of people. The evidence did not establish that in this case.

Since the privilege in the Partington Note had not been lost, the claimants could be restrained from making use of its contents, even though they had innocently come into possession of the confidential information. In some cases, as an injunction is a discretionary remedy, it might properly be refused eg on the ground of inordinate delay. What is inordinate delay must be evaluated in each case; on the facts here, the court was satisfied that delay was not a bar to the grant of injunctive relief.

Grigson Comments

The court assumed for these purposes that what Mr Partington knew about phone hacking (whether deriving from instructions received from MGN or coming to his knowledge in the course of acting as MGN’s lawyer or having some other origin) was capable of being privileged information.

Nonetheless, the Grigson Comments were not privileged because they lacked the requisite quality of confidentiality. The AGM and the subsequent reception were public occasions. Mr Grigson could not reasonably have thought that his answers to questions on the “hot topic” of MGN’s knowledge of phone hacking, at such public occasions, could be confidential, and his listeners (which probably included other journalists, apart from Mr Johnson, and shareholders) would not think that they were being imparted confidential information.

It was in any event too late for MGN to claim that the communication was confidential and to assert privilege. The claimants had provided MGN with a transcript of the Grigson Comments on 6 June 2018 and pleaded the Grigson Comments in their Particulars of Claim shortly afterward. That did not prompt a claim to privilege, and the Particulars of Claim lay on the court file and were open to public inspection until 5 December 2018. It would therefore be inappropriate to grant injunctive relief, even if privilege had attached.

Herbert Smith Freehills LLP is authorised and regulated by the Solicitors Regulation Authority.

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